MTQ Corporation

[Jon-san]

I really should just sit down with you guys one day over a cup of cappuccino and just listen and hear you guys discuss and be able to ask questions on the spot to learn. So much things I need to know, yet so little I can understand. Haha.

[Musicwhiz]

I really should just sit down with you guys one day over a cup of cappuccino and just listen and hear you guys discuss and be able to ask questions on the spot to learn. So much things I need to know, yet so little I can understand. Haha.

Haha sure! Then I will have a glass of Ice Milo!

[Musicwhiz]

Today is supposed to be the date of payment for MTQ's FY 2011 interim dividend of 2c/share. However, for those who chose scrip, does anyone know when the shares will be credited into our CDP accounts? I've been through bonus issues and share splits but a scrip dividend (to me) sounds somewhat different.

dydx,

If you have any info on this I'd appreciate it, as I understand you are a veteran investor.

P.S. - I have no intention to sell any of my stake, including the scrip shares; just wish to know the timeline for my own info.

Thanks!

[dydx]

Musicwhiz,

Logically speaking, the new shares for the scrip dividend should be issued and credited to those shareholders' CDP accounts on the same day the cash dividends are paid out. You should get an advice from CDP on the scrip dividend in due course.

Based on the last done share price of $0.93 and the $0.83/share issue price for the scrip dividend, those who have opted for scrip are already up $0.10/share (or 12%) vs. those who have chosen to take their dividends in cash.

[wsreader]

Logically speaking, the new shares for the scrip dividend should be issued and credited to those shareholders' CDP accounts on the same day the cash dividends are paid out.

Just checked my bank account and noted a nice credit from MTQ's $0.02/share dividend. You can check your CDP account whether the scrip has been credited.

[Musicwhiz]

Interestingly, I was just doing some calculations on the scrip dividend.

Total issued share capital (less treasury shares) = 88,059,117 shares

Interim dividend was 2 cents/share, so this means $1,761,182.34 to be paid out. Each scrip share costs $0.83, so theoretically a maximum of 2,121,906 shares should be issued if everyone chose scrip.

In reality, just 970,857 new shares were issued. Of this amount, it should be noted that Kuah Kok Kim was issued 550,843 shares (based on his total stake, which means he chose 100% scrip), and Kuah Boon Wee was alloted 38,024 shares (also 100% scrip). Stripping these 2 out, this means just 381,990 scrip shares were issued. This represents just 18% of the theoretical 2,121,906 shares which could be issued!

So my conclusion is that most of the retail shareholders did not choose scrip dividend, but instead opted for cash. The total shares alloted under scrip was just 45% (970,857 divided by 2,121,906); which implies more than half the shareholders chose cash instead. So the Company has to cough up $955,370 for the shareholders who chose cash over scrip. This represents a savings of about $805,811 for the Company, as compared to if the dividend was purely in cash.

Just food for thought.

P.S. - I chose to accept 100% scrip for my interim dividend.

[dydx]

Of course, we can expect most of the small minority shareholders holding say 10 lots (or less) to take the $0.02/share Interim dividend in cash, as naturally most of them would not like to hold small odd lots of say 241 shares (based on 10,000 shares x $0.02 / $0.83).

I think it is more important to take note that as a result of opting to take their dividends in scrip, both Senior Kuah and Kuah Kia have managed to raise their personal beneficial holdings from this exercise - for Senior Kuah, from 25.6767% to 26.2955%; and for Kuah Kia, from 1.7724% to 1.8151%.....
http://info.sgx.com/webcorannc.nsf/Annou...endocument [Senior Kuah]
http://info.sgx.com/webcorannc.nsf/Annou...endocument [Kuah Kia]
I suppose this is a good example of how the rich becomes richer - they hold on to valuable business assets for the long term, and act to increase their holdings when good opportunities present themselves.

It is also relevant to note that as a result of the issue of 970,857 new (scrip dividend) shares, and based on the last done share price of $0.93, MTQ's market cap. has increased by $903k. Assuming the current share price holds up, the resultant higher market cap. is actually good for all shareholders.

[aspeed]

Even if the dividend is given out in cash, they (or anyone else) can alway choose to use the cash dividend to buy from open market to boost up their holding. The only difference is they would buy it at prevailing trading price (plus the brokage).
So seriously be it scrip or not, there isn't much difference except the price discount of scrip price.

[Nick]

Even if the dividend is given out in cash, they (or anyone else) can alway choose to use the cash dividend to buy from open market to boost up their holding. The only difference is they would buy it at prevailing trading price (plus the brokage).
So seriously be it scrip or not, there isn't much difference except the price discount of scrip price.

The discount is around 10% which is pretty significant. You can purchase 11.1% more shares at the discounted prices than at the prevailing price then.

[valueinvestor]

It is to the advantage of those who opted to take scrip then cash. The big shareholders always have a advantsge over the small investors.